Hepatitis B virus (HBV) is an important blood-borne infection; it is mainly through continued screening of blood donations and inactivation procedures for plasma derivatives that it is excluded as a transfusion complication. The close association between HBV and hepatocellular carcinoma (HCC) makes these measures even more significant. Recently, genetic variants of HBV have been discovered; the mutations found in these may explain more severe clinical findings in some patients. The HBV X protein has been shown to transactivate a variety of cellular and viral genes and it may play a part in the pathogenesis of HBV-associated HCC. We extracted DNA from HCC tissues and adjacent nontumorous livers from 20 patients and from the sera of 18 residents of the same county in China who were chronically infected with HBV without HCC. A 228-base pair segment of the X gene was amplified by nested PCR and sequenced. Point mutations were found at X gene codons 130 and 131 in 17/20 HCC tissues (85%) compared to 2/18 sera of persons chronically infected with HBV without HCC (11%) (p<0.0001). Both mutations are located in the enhancer-II-core promoter region of the HBV genome; both are upstream and adjacent to codons 132 to 139, a region essential for transactivation by X. It is possible that mutations at codons 130 and 131 may affect HBV replication or X gene transactivation.